USDCAD broke to a fresh 20-month high yesterday, following a strong move above the 1.3100 mark. The pair has managed to deliver a more decisive break above the resistance zone marked with 38.2% retracement of the post-pandemic downward move (1.3020 area), after a few failed attempts in previous months. Daily high was reached slightly below the upper limit of the upward channel and the pair has given back some gains since as bets for a 100 bp Fed rate hike in July were parred by Fed speakers. Nevertheless, fundamentals remain bullish with Fed being more aggressive than BoC and technical outlook also seems to support continuation of the upward move. The next major resistance to watch is 1.3350 area, marked with previous price reactions and 50% retracement. USDCAD traders should keep in mind that the pair is likely to become more volatile near 1:30 pm BST as US retail sales report will be released. Speech from Fed Bostic at 1:45 pm BST may also result in some USD volatility.
Source: xStation5
